Managed funds the next Internet wave
Buying managed funds via the Internet will become as common as buying shares via the Internet, according to research by Your Prosperity.
Buying managed funds via the Internet will become as common as buying shares via the Internet, according to research by Your Prosperity.
Your Prosperity chief executive John Reid says the group’s research indicates the bias towards online share trading will drop away as online users became more mainstream and focussed on managed funds.
“One of the most notable results was that the next generation of online investors is far more interested in managed funds then are the early adopters,” Reid says.
This was confirmed by the results which showed three quarters of those who intended to trade online in the next year indicated they would be looking for the ability to buy and sell funds as well as shares.
This would be a marked increase from the current 10 per cent of online traders who are also purchasing managed funds online.
These numbers correlate to predicted growth in Internet usage, with 35 per cent of investors who use the Internet, but not for investment purposes, planning to do so in the next twelve months.
According to Your Prosperity, those taking up online investing would also be more likely to take long term views of the market with a buy and hold focus on investing.
Many also wish to be able to manage a total portfolio online, however only about 20 per cent of investors currently have the majority of their investments online.
Reid says this demand will continue to fuel change within the Australian market which will follow the patterns which were set in the USA in recent years.
While the potential of online investing may be bright, Your Prosperity has not been a big money earner for MLC, totalling losses of more than $10.7 million since launching in 1998.
Regardless of this MLC has continued to expand the Your Prosperity website and product range in the last 12 months to include funds trading, superannuation and discount broking services.
AUTHOR
Jason Spits
Recommended for you
The month of April enjoyed four back-to-back weeks of growth in financial adviser numbers, with this past week seeing a net rise of five.
ASIC has permanently banned a former Perth adviser after he made “materially misleading” statements to induce investors.
The Financial Services and Credit Panel has made a written order to a relevant provider after it gave advice regarding non-concessional contributions.
With the election taking place on Saturday (3 May), Adviser Ratings examines how the two major parties could shape the advice industry in the future.
